Correlation Between MEDICAL FACILITIES and AMBRA SA

Can any of the company-specific risk be diversified away by investing in both MEDICAL FACILITIES and AMBRA SA at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining MEDICAL FACILITIES and AMBRA SA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MEDICAL FACILITIES NEW and AMBRA SA A, you can compare the effects of market volatilities on MEDICAL FACILITIES and AMBRA SA and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in MEDICAL FACILITIES with a short position of AMBRA SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDICAL FACILITIES and AMBRA SA.

Diversification Opportunities for MEDICAL FACILITIES and AMBRA SA

0.43

Correlation Coefficient

MEDICAL FACILITIES  AMBRA SA

Very weak diversification

The 3 months correlation between MEDICAL and AMBRA is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding MEDICAL FACILITIES NEW and AMBRA SA A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMBRA SA A and MEDICAL FACILITIES is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on MEDICAL FACILITIES NEW are associated (or correlated) with AMBRA SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMBRA SA A has no effect on the direction of MEDICAL FACILITIES i.e., MEDICAL FACILITIES and AMBRA SA go up and down completely randomly.

Pair Corralation between MEDICAL FACILITIES and AMBRA SA

Assuming the 90 days horizon MEDICAL FACILITIES NEW is expected to under-perform the AMBRA SA. But the stock apears to be less risky and, when comparing its historical volatility, MEDICAL FACILITIES NEW is 1.08 times less risky than AMBRA SA. The stock trades about -0.03 of its potential returns per unit of risk. The AMBRA SA A is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  500.00  in AMBRA SA A on December 21, 2024 and sell it today you would lose (4.00) from holding AMBRA SA A or give up 0.8% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

MEDICAL FACILITIES NEW  vs.  AMBRA SA A

MEDICAL FACILITIES NEW

Risk-Adjusted Performance

Very Weak

Over the last 90 days MEDICAL FACILITIES NEW has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

AMBRA SA A

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AMBRA SA A are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, AMBRA SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with MEDICAL FACILITIES and AMBRA SA

The main advantage of trading using opposite MEDICAL FACILITIES and AMBRA SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDICAL FACILITIES position performs unexpectedly, AMBRA SA can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in AMBRA SA will offset losses from the drop in AMBRA SA's long position.

The idea behind MEDICAL FACILITIES NEW and AMBRA SA A pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.